To Fix or Float?

The question has come yet back again whether now is a good time to fix or float your mortgage.

I am a big enough cynic to believe that what the bank(s) really want is to capture you as a customer. While floating, a borrower can change banks with ease with no little or no cost, and the ability to shop around.

Once locked into a fixed rate it’s all a bit too hard.

At present the banks are fighting each other and cutting rates to obtain an edge. What could be better for them to offer a fixed rate and stop worrying about customers wandering off ?

In my view I would stay floating as it will be obvious if fixing becomes  necessary simply by keeping up with the latest financial news.

Westpac economist says it’s time to fix mortgages before interest rates go up; says 2 to 4 year fixed mortgages offer best value
March 2, 2012 – 09:11am,

Westpac Economist Dominick Stephens has released a research report saying it’s time for floating rate mortgage borrowers to fix before interest rates go up.

He says two to four year fixed mortgage rates offer the best value.

Westpac’s 2 year fixed mortgage rate is 5.79%, its 3 year mortgage rate is 6.10% and its four year mortgage rate is 6.5%. Westpac’s Choices Everyday floating mortgage rate is 5.60%.

Read the rest here:

http://www.interest.co.nz/property/58187/westpac-economist-says-its-time-fix-mortgages-interest-rates-go-says-2-4-year-fixed-m

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